The Benefits of the Software-as-a-Service Model
Advice by Curt Finch, Journyx
JANUARY 02, 2006 (COMPUTERWORLD) When the Internet burst upon the scene in the early 1990s, the concept of software as a service (SAAS) seemed an idea whose time had come. It got hyped along with everything else about the Internet and reached a massive peak of inflated expectations in early 2000 as venture capitalists funded dozens of nearly identical companies that provided various SAAS offerings.
As venture funding dried up in mid-2000, the cracks in the SAAS model began to appear. The business plans assumed zero customer attrition, an uncompetitive landscape and initial public offerings in the absence of revenue. Disillusionment set in, and 99% of those companies are no longer around. However, the strong did survive, and now, due to the success of companies like Salesforce.com Inc. and RightNow Technologies Inc., SAAS is back.
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Web 2.0 offers fertile ground for SAAS
Fast Internet, customers' comfort levels with business on the web and vendors' willingness to embrace open standards have created a rich environment, SAAS proponents say By Elizabeth Montalbano, IDG News Service March 03, 2006 (InfoWorld) Despite hype and venture capital money, the ASP (application service provider) model of the late 1990s failed in spectacular -- and very public -- fashion.
But industry leaders and analysts who gathered this week at the Software as a Service Summit in Napa, California, said that current market conditions give the new generation of ASPs, which the industry now calls software-as-a-service (SAAS) providers, a far better chance at success.
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A field guide to software as a service
Hosted-application providers offer everything you need for a totally outsourced datacenter -- almost
By Eric Knorr, Leon Erlanger, James R. Borck
April 18, 2005 (InfoWorld)
Everywhere you turn, another company pops up offering SaaS (software as a service). Inspired by the success of Salesforce.com (Profile, Products, Articles), SaaS vendors are hoping customers large and small will get the message: Browser-based, pay-as-you-go applications mean fewer servers for your IT department to maintain and less capital to shake loose from the CFO for software licenses and hardware.
For whatever such estimates are worth, IDC recently forecasted that worldwide spending on SaaS will reach .7 billion by 2009. But there’s so much SaaS running around already that we couldn’t help but wonder: Could you run a business entirely on hosted offerings?
That somewhat playful question was the genesis of this buyer’s guide to SaaS -- although we already knew the answer. Healthy enterprises need to develop their own unique applications, and any modern IT infrastructure needs to be fully integrated in a manner that can’t be achieved with SaaS solutions today.
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How ASPs Work
by Marshall Brain
HowThingsWork.com
The web and the Internet began to really heat up and receive significant media exposure starting around 1994. Initially, the Web started as a great way for academics and researchers to distribute information; but as millions of consumers flocked to the Internet, it began to spawn completely new business models. Three good examples of innovative models include:
• Amazon - Amazon (which opened its doors in July, 1995) houses a database of millions of products that anyone can browse at any time. It would have been impossible to compile a list this large in any medium other than the web.
• Ebay - Online auctions make it easy and inexpensive for millions of people to buy and sell any imaginable item. It would be impossible to do this at a reasonable cost or in a timely manner with any medium other than the web.
• Epinions - Thousands of people contribute to a shared library of product reviews. One of the web's greatest strengths is its worldwide view and collaborative possibilities.
These different business models are all visible to anyone surfing the web. One of the most interesting behind-the-scenes business models that the Web has created is called the ASP, or Application Service Provider. ASPs are a completely new way to sell and distribute software and software services.
Although ASPs were possible before the advent of the web, the web makes them so easy to create that they have proliferated hugely in the last several years.
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